Surge Energy (SGY) AI Stock Analysis

• Market Cap: C$866.84M
• Dividend Yield: 7.59%
• Average Volume (3M): 610.39K
• Price to Earnings (P/E): 17.0
• Beta (1Y): 0.73
• Revenue Growth: -7.36%
• EPS Growth: N/A
• Country: CA
• Employees: 83
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): -0.07
• Shares Outstanding: 98,840,960
• 10 Day Avg. Volume: 748,369
• 30 Day Avg. Volume: 610,386
• PEG Ratio: -0.10
• Price to Book (P/B): 0.95
• Price to Sales (P/S): 1.43
• P/FCF Ratio: 6.82
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$9.57
• Price Target Upside: 10.09% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 0.26
• Revenue Forecast (FY): C$527.60M

• Rating: 73 Outperform
• Price Target: C$9.50 ▲(9.32% Upside)
• Action: Upgraded Date: 03/06/26
• Date: Action: Upgraded 03/06/26

The score is driven primarily by strong cash generation and positive free cash flow alongside manageable leverage, plus supportive technical momentum with price above key moving averages. Offsetting these positives are the company’s pronounced revenue/profitability volatility typical of a cyclical E&P business, and a valuation that looks reasonable rather than clearly discounted despite the high dividend yield.

Surge Energy Business Overview & Revenue Model

Company Description

Surge Energy Inc. explores for, develops, and produces oil and gas in western Canada. The company holds interest in the Greater Sawn Lake assets located in Northern Alberta; Valhalla/Wembley property located in northwestern Alberta; Sparky assets located between Provost and Wainwright in eastern Alberta and western Saskatchewan; and Shaunavon properties located to the southwest of Swift Current, Saskatchewan. It holds an average working interest of approximately 84% in approximately 123,884 net developed acres and approximately 83% in approximately 68,031 net undeveloped acres in Greater Sawn area; approximately 70% in approximately 22,920 net developed acres and approximately 72% in approximately 10,680 net undeveloped acres in Valhalla area; and approximately 90 % in approximately 59,655 net developed acres and 98% in approximately 47,398 net undeveloped acres in Sparky area. As of December 31, 2021, it held interests in 362 net oil and 20 net gas wells in Greater Sawn area; 100 net oil and 9 net gas wells in Valhalla area; 424 net oil and 6 net gas wells in Sparky area; and 185 net oil wells, as well as an average working interest of approximately 100% in approximately 24,249 net developed acres and 12,021 net undeveloped acres in the Shaunavon properties. The company was formerly known as Zapata Energy Corporation and changed its name to Surge Energy Inc. in June 2010. Surge Energy Inc. was incorporated in 1998 and is headquartered in Calgary, Canada.

How the Company Makes Money

Surge Energy generates revenue primarily through the exploration, development, and production of oil and natural gas. The company's key revenue streams include the sale of crude oil, natural gas, and natural gas liquids. Surge Energy operates in core areas with substantial reserves, allowing for efficient extraction and production. Additionally, the company may engage in strategic partnerships or joint ventures to enhance operational efficiency and expand its production capabilities. Market factors such as commodity prices, production volumes, and operational efficiencies significantly influence the company's earnings.

Surge Energy Financial Statement Overview

Summary

Supported by strong and consistent operating cash flow (roughly C$266–279M in 2022–2025) and positive free cash flow in 2022–2025 with growth in 2025. Balance sheet leverage looks manageable (debt-to-equity ~0.31–0.34), but profitability and revenue are volatile (2025 revenue down ~22% and margins have swung sharply), reflecting cyclical commodity sensitivity.

Income Statement

Profitability rebounded in 2025 (net income of ~C$40M vs. a loss in 2024), with solid operating profitability as shown by positive operating earnings and a mid-single-digit net margin. However, revenue has been volatile and declined materially in 2025 (down ~22% after growth in 2024), and margins have swung sharply over time, indicating earnings sensitivity to commodity-price and cycle effects.

Balance Sheet

Leverage appears manageable, with debt-to-equity in the ~0.31–0.34 range in 2024–2025 and equity remaining substantial. Returns on equity are positive again in 2025 but remain modest, and the historical volatility (including prior periods with weak or negative equity) highlights that the capital structure and returns can shift meaningfully across the cycle.

Cash Flow

Cash generation is a clear strength: operating cash flow is consistently strong in recent years (roughly C$266–279M in 2022–2025), and free cash flow is positive in 2022–2025 (about C$83–106M), with growth in 2025. That said, free cash flow relative to net income is not consistently high and earlier periods showed weaker cash conversion (including negative free cash flow in 2021), reinforcing cyclicality and execution risk.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	480.72M	665.29M	558.64M	734.47M	414.64M
Gross Profit	114.28M	356.90M	348.63M	464.61M	243.96M
EBITDA	279.05M	163.24M	307.51M	340.70M	542.12M
Net Income	40.26M	-53.72M	15.75M	231.72M	407.61M
Balance Sheet
Total Assets	1.32B	1.37B	1.48B	1.55B	1.28B
Cash, Cash Equivalents and Short-Term Investments	18.65M	7.59M	0.00	0.00	0.00
Total Debt	243.89M	232.12M	282.18M	347.92M	337.06M
Total Liabilities	599.53M	627.64M	636.79M	711.75M	762.06M
Stockholders Equity	724.98M	738.51M	843.98M	838.32M	513.38M
Cash Flow
Free Cash Flow	100.42M	83.54M	84.57M	106.18M	-3.30M
Operating Cash Flow	265.90M	278.65M	266.14M	276.13M	100.48M
Investing Cash Flow	-181.67M	-153.00M	-177.56M	-332.27M	-16.00M
Financing Cash Flow	-73.18M	-118.05M	-88.58M	56.15M	-84.48M

Surge Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.69
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SGY, the sentiment is Positive. The current price of 8.69 is above the 20-day moving average (MA) of 8.20, above the 50-day MA of 7.52, and above the 200-day MA of 6.83, indicating a bullish trend. The MACD of 0.31 indicates Negative momentum. The RSI at 69.30 is Neutral, neither overbought nor oversold. The STOCH value of 81.34 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:SGY.

Surge Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VLE	82 Outperform	C$1.54B	8.80	58.06%	―	23.77%	198.71%
SOIL	74 Outperform	C$847.99M	2.80	12.26%	―	24.36%	-55.40%
SGY	73 Outperform	C$866.84M	17.02	5.47%	7.59%	-7.36%	―
TNZ	72 Outperform	C$1.97B	2.37	112.36%	―	194.52%	10204.44%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
OBE	62 Neutral	C$788.84M	16.60	-14.96%	―	-11.85%	-307.86%
SNM	57 Neutral	C$604.44M	18.35	11.72%	―	46.17%	-82.95%

Surge Energy Corporate Events

Surge Energy Lifts Output, Cuts Costs and Boosts Free Cash Flow in 2025

Surge Energy reported that 2025 average production rose to 23,491 boepd, about 1,000 boepd above guidance, while capital spending was cut to $159.7 million, more than $35 million below 2024 levels and $10 million under budget. The company also lowered net operating costs to $17.91 per boe, generated adjusted funds flow of $279.2 million and free cash flow of $119.5 million, and returned $86.9 million to shareholders through dividends, share buybacks, and debt reduction.

Despite a roughly US$11 per barrel drop in WTI crude prices year over year, Surge delivered its best finding and development costs in three years, with a total proved and probable F&D cost of $14.87 per boe and a 2.4x recycle ratio, underscoring strong drilling and waterflood performance. The company achieved a 136% reserves replacement ratio, a reserve life index of 11.4 years, reported a net asset value of $13.06 per share, and appointed industry executive Ryan Gritzfeldt to its board, reinforcing both asset depth and governance bench strength.

The most recent analyst rating on (TSE:SGY) stock is a Buy with a C$9.75 price target. To see the full list of analyst forecasts on Surge Energy stock, see the TSE:SGY Stock Forecast page.

Surge Energy Confirms March 2026 Cash Dividend

Surge Energy Inc., a Calgary-based intermediate oil producer, concentrates on conventional oil reservoirs and employs proven technologies to improve recovery rates and free cash flow. The publicly traded company targets enhanced shareholder returns through disciplined acquisition and development of high-quality oil assets.

The company confirmed a cash dividend of $0.043333 per share, payable on March 16, 2026, to shareholders of record as of February 28, 2026, in respect of February 2026 production. The dividend, designated as an eligible dividend for Canadian tax purposes, reflects Surge’s ongoing policy of returning capital to shareholders backed by its free cash flow generation.

The most recent analyst rating on (TSE:SGY) stock is a Buy with a C$8.50 price target. To see the full list of analyst forecasts on Surge Energy stock, see the TSE:SGY Stock Forecast page.

Surge Energy Confirms February Dividend, Underscoring Shareholder Return Strategy

Surge Energy Inc. has confirmed a cash dividend of $0.043333 per share to be paid on February 16, 2026, to shareholders of record on January 31, 2026, in respect of January 2026 production, and classified the payment as an eligible dividend for Canadian tax purposes. The announcement reinforces Surge’s commitment to returning capital to shareholders and underscores the company’s ongoing free cash flow generation and dividend-focused strategy within the conventional oil segment.

The most recent analyst rating on (TSE:SGY) stock is a Hold with a C$7.00 price target. To see the full list of analyst forecasts on Surge Energy stock, see the TSE:SGY Stock Forecast page.

Surge Energy Announces January 2026 Dividend

Surge Energy Inc. has announced a cash dividend of $0.043333 per share to be paid on January 15, 2026, for shareholders of record on December 31, 2025. This dividend reflects the company’s ongoing commitment to providing shareholder returns and may impact its market positioning by reinforcing investor confidence in its financial strategies.

The most recent analyst rating on (TSE:SGY) stock is a Hold with a C$9.00 price target. To see the full list of analyst forecasts on Surge Energy stock, see the TSE:SGY Stock Forecast page.